US shutdown breaks record, should you be concerned?

Brajesh Upadhyay, Washington
Published : 11:25, Jan 12, 2019 | Updated : 11:49, Jan 12, 2019

A sign declares the National Archive is closed due to a partial federal government shutdown in Washington, US on Dec 22, 2018. REUTERS/File PhotoThe US government shutdown under President Donald Trump became the longest on record on Saturday (Jan 12), beating Bill Clinton’s 1996 record of 21 days without federal funding.

As the stalemate continued over Trump’s demand for a wall along the border with Mexico, hundreds of thousands of government workers went without pay for the first time on Friday.

With airport screening staff, air traffic controllers and FBI officers among those affected, union officials are warning that public safety could be compromised if the shutdown drags on.

Many American farmers who were expecting the promised compensation from the Trump administration after a sharp drop in soybean prices due to the tariff war with China are now stuck because of the shutdown.

Economists estimated that the US economy may have already lost 3.6 billion dollars by Friday and if the shutdown continues for another two weeks, it would cost the economy more than 6 billion dollars which just about exceeds the amount President Trump has been seeking for his wall.

President Donald Trump talks to reporters as he visits the banks of the Rio Grande River during the president`s visit to the US - Mexico border in Mission, Texas, January 10, 2019. REUTERSFor Bangladesh or other countries, the shutdown may appear to be something distant or just another quirk of US domestic politics for now, but experts believe that if it prolongs further, it would soon start having an impact on the rest of the world.

Experts say the effect could be felt almost immediately by exporters and traders as they may see their containers stranded at various ports if screening staff stop reporting for work.

The State Department says it will keep issuing visas and passports but also warned that these will remain operational as long as there are sufficient funds to support operations. It may also impact thousands of workers employed by US embassies and consulates all over the world.

The Washington Post reported that the U.S. Geological Survey, one of the world’s top resources for scientific research on seismological events, was unable to provide data on the tsunami in Indonesia as just about 75 of its more than 8,000 employees were operational because of the shutdown.

Cher Muzyk, who marched in Thursday`s `Rally to End the Shutdown` outside the White House, poses with her twins at their home in Nokesville, Virginia, U.S., January 11, 2019. REUTERSThere are fears that the shutdown may also impact humanitarian assistance and foreign aid as no new funding commitments or obligations can be made during a shutdown, except to protect life and property.

But more than anything else the biggest concern is that the shutdown could have bigger implications for the economy if it continues much longer.

“In addition to the direct drag to government consumption, we could see indirect effects from a temporary slowdown in consumption due to weaker spending from furloughed workers and delay in business investments from policy uncertainty,” the CNBC news website said quoting Bank of America economists.

Every year, both the House and the Senate are supposed to pass 12 appropriations bills to fund various agencies. But if all efforts fail, the government shuts down until a deal is brokered. Hundreds of thousands of federal workers have to stay at home while agencies largely halt their work. Since 1974, there have been 21 federal shutdowns.

The longest previous shutdown lasted three weeks during December 1995 and January 1996. It followed a budget spat between President Bill Clinton and House Speaker Newt Gingrich.